Employment Allowance De Minimis State Aid

From April 2020 employment allowance is operated as De Minimis state aid. Employment allowance claims must now be submitted at the start of each tax year. You need to indicate all state aid sectors that apply to the business in order to submit an employment allowance claim.

If the state aid sector has not been set and “Claim employment allowance” a message is displayed on the home screen.

State Aid Industrial Sectors

You can set which state aid sectors apply to your business from “Company Maintenance > Tax & NI > Claim Employment Allowance” or by clicking “Configure Employment Allowance”.

If a company is no longer eligible to claim employment the “Don’t claim employment button” withdraws the EA claim.

To claim employment allowance the State Aid Sector(s) or State Rules do not apply must be selected.

If businesses have received any other De Minimis State Aid, they will need to check that receiving the full £4000 Employment Allowance, (already received or allocated in the claim year and previous two tax years)  when added to any other De Minimis State Aid will not exceed the limit for their sector. If the total would exceed the limit or the sector, they are not eligible for to make a claim.

After Claiming Employment Allowance

Once a claim for employment allowance has been submitted with one or more of the De Minimis state aid business sectors selected, a letter will be issues to the employer advising that employment allowance has been given under the De Minimis state aid scheme. You do not need to wait for this letter to start using employment allowance.

If you claim is rejected you will be notified via the Generic Notification System(GNS).  For information on viewing GNS messages please see https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye5055#IDAXZXWD

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